Interest rate hike

The interest rate decision delivered by Reserve Bank Governor Lesetja Kganyago at the first meeting of 2023, brings South Africa's prime lending rate to 10.75%.

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The South African Reserve Bank raised the repo rate by 0.25%, taking the prime lending rate in the country to 10.75%

“Achieving a prudent public debt level, increasing the supply of energy, moderating administered price inflation and keeping wage growth in line with productivity gains would enhance the effectiveness of monetary policy and its transmission to the broader economy. Our forecast for core inflation is somewhat lower at 5.2% in 2023 (down from 5.5%) and 4.7% in 2024 (down from 4.8%),” Kganyago said. “Domestic food price inflation continues to surprise higher. In this uncertain environment, monetary policy decisions will continue to be data dependent and sensitive to the balance of risks to the outlook,” Kganyago said. “As this year commences, high inflation & weak economic growth continue to shape global conditions. “The Bank’s forecast of headline inflation for 2023 is unchanged at 5.4% and is slightly higher at 4.8% for 2024.

“Inflationary pressures are now subsiding, and South Africa appears to be very close to, if not at, the peak of the current interest rate cycle. Interest rates ...

To Subscribe to Sunday World, [click here](https://subs.arena.africa/#!/offer/411?utm_source=promo411&utm_medium=Circ) Interest rates have reached similar levels to those experienced pre-pandemic – now at 10.75% versus 10.25% in the first half of 2019,” said Dyer. Internationally, a source of good news is the reversal of China’s zero-Covid-19 policy. [For more business news from Sunday World, click here. “With the exception of a possible single small additional rate hike this year, I believe that we are now out of the woods, and that South Africans can start to plan around the interest rate of 10.75 – 11%. “In addition, the rate of successful home loan approvals remains robust, currently sitting at 84.1% in quarter four of 2022, up from the approval rate of 83.7% recorded in quarter four of 2021.”

Governor of the SA Reserve Bank Lesetja Kganyago has announced a repo rate hike of another 25 basis points. Ouch!

[25 basis points](https://www.resbank.co.za/content/dam/sarb/publications/statements/monetary-policy-statements/2023/january-/Statement%20of%20the%20Monetary%20Policy%20Committee%20January%202023.pdf) on Thursday, taking the country’s repurchase rate to 7.25%. Governor of the SA Reserve Bank Lesetja Kganyago has announced a repo rate hike of another 25 basis points. According to Reserve Bank governor Lesetja Kganyago, the vote was not unanimous, with three members voting for a 25 basis point hike and two preferring a 50 basis point move. The move was in line with market expectations, with analysts and economists anticipating a 25 basis point or 50 basis point hike although most forecast the latter. The latest interest rate hike marks the ninth in the current cycle, with the total adjustment being a massive 375 basis points since the hike cycle started in November 2021. [FOR THE LATEST BUSINESS NEWS VISIT THE SOUTH AFRICAN WEBSITE](https://www.thesouthafrican.com/news/business-news-and-finance/)